GM, UAW Agree on New Contract

General Motors and the United Auto Workers union this weekend said they reached a tentative labor agreement that includes a new profit-sharing formula for GM's 49,000 hourly employees.

Details of the settlement were being withheld, pending ratification with local union leaders.

The UAW's old agreement expired Sept. 14, but the union was barred from striking under the terms of the $49.5 billion bailout of GM in 2009.

GM executives had said their main goal was to contain any growth of the company's labor costs.

"In these uncertain economic times for American workers and faced with the globalization of the economy, the UAW approached these negotiations with new strategies and fought for and achieved some of our major goals for our members, including significant investments and products for our plants," said UAW President Bob King in a statement after the settlement was reached.

The terms of the agreement "reflect the fact that it was UAW members who helped turn this company around," said UAW Vice President Joe Ashton, who directs the union's General Motors Department.

"When GM was struggling, our members shared in the sacrifice. Now that the company is posting profits again, our members want to share in the success," Ashton said. "To be clear, GM is prosperous because of its workers. It's the workers and the quality of the work they do, along with the sacrifices they made, that have returned this company to profitability."

"We wanted a contract that provides our members with a real share of the success of the company and ensures its continued success. Our members cannot succeed unless the company succeeds, and we are strongly committed to that joint success, as this contract demonstrates," Ashton added.

'Creative Problem-Solving Approach'

Cathy Clegg, GM vice president, said the company and union "used a creative problem-solving approach to fashion an agreement that addresses the needs of employees and positions our business for long-term success."

"We worked hard for a contract that recognizes the realities of today's marketplace, enabling GM to continue to invest in U.S. manufacturing and provide good jobs to thousands of American," Clegg said.

Ashton said the UAW turned aside changes to the company's pension and rejected major concessions in health care, but the UAW fought for and protected the health care benefits of its members.

In addition, the agreement includes improved profit sharing with far greater transparency than in the past, the union asserted.

"We prove again today that through the collective-bargaining process, we can provide decent wages, benefits and employment rights for workers while ensuring quality products and healthy profits for employers," King said. "We stand recommitted to our goal of organizing and fighting for all workers in the entire U.S. auto industry."

King said the UAW has played a central role in building America's middle class.

King, however, also said the union has been forced to compete with non-union workers who in most cases receive lower pay and benefits.

"There will continue to be a downward pressure on the wages and benefits of all autoworkers," King said.